Thai unrest could threaten trade

Australian exporters warned last night that escalating violence in Thailand could threaten the $18 billion trade relationship between the two countries if it persists.

The Australian Institute of Export was responding after three days of violence involving government security forces and anti-government “Red Shirt’’ demonstrators left up to 35 people dead and 240 injured as violence spread to areas beyond central Bangkok.

Four Australians have been injured as sporadic violence has broken out between the two groups. Thai Prime Minister
Abhisit Vejjajiva
has refused to accept demands for immediate elections. The Prime Minister has vowed the occupation of the city centre by the Red Shirts must end before there can be any negotiations, raising fears last night of further deadly clashes.

“Up until now our members are not reporting much of an impact but it will have an impact if it drags on many more weeks,’’ Australian Institute of Export general manager Peter Mace told The Australian Financial Review last night. “Fortunately most of our trade is conducted through the ports and avoids central Bangkok,’’ he said.

But Mr Mace said the violence was starting to affect people’s willingness to travel to Thailand to sign contracts and conduct business. The Thai government has already conceded the unrest will shave as much as 0.5 per cent off the country’s gross domestic product, cut tourist numbers and hurt investor confidence.

A Qantas spokeswoman said last night the airline was continuing to operate flights to Thailand as normal despite the escalating violence but was offering a full-fare waiver for those who did not want to travel to Bangkok. “There has been no activity around the airport so it is considered safe to operate flights in and out of Bangkok at this stage,’’ she said.

About 390,000 Australians visit Thailand each year, according to the federal Department of Energy, Resources and Tourism.

The federal government has closed its Bangkok embassy doors to visitors after street clashes erupted in front of the building, although the mission is continuing to function. The Department of Foreign Affairs and Trade has issued travel advice urging Australians to reconsider the need to travel to Thailand “due to the deterioration in the security environment caused by widening political unrest and civil disorder occurring in Bangkok and other parts of the country’’.

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Foreign Minister Stephen Smith yesterday urged Australians to avoid the protests and the Thai government and Red Shirts to negotiate.

Global intelligence specialist Stratfor reported the Thai Prime Minister had extended a state of emergency in Thailand to five more northern and north-eastern provinces as unrest spread to more areas where the Red Shirts are based. The Red Shirts want early elections to replace a government they view as illegitimate. Many support exiled former prime minister Thaksin Shinawatra, who was ousted in 2006.